Context: Thesis Total System

In his book "Platform for Change" Stafford Beer argued for a new world order using cybernetic techniques. In summary he produced this extraordinary diagram which says it all.

Motivation

In their report "Global Capital Markets and the Global Economy" to the
Global Public Policy Symposium in Paris (7-8 November 2006) CEOs and Chairs of PwC, KPMG, Grant
Thornton, BDO, Deloitte and Ernst & Young advocated real-time
reporting of accounts and performance on the web.

This creates a major commercial opportunity for suppliers of real-time
reporting web software. We intend to enhance this opportunity further. The
participants are expert in the Viable System Model (VSM)
of Stafford Beer's management cybernetics. In real-time this produces
features for application to the day-to-day risk-oriented management, regulation and
development of small, medium and large enterprises of all kinds.

An Open Source project is proposed using the web, SQL and XML that will
support accounting and management in a wide range of sectors including
Health. Applications are foreseen in the developing world supported on
mobile phones including e-Money and e.g. OLPC hardware:
MIT's "$100 Micro".

Contents to come

Market Drivers

Problem Development

Historical Overviews

A Generic Introduction to the Solution

Benefits

What to Look for in an Ideal Solution

Developing the enterprise

A good manager repeatedly asks "Do I do what I always do or do I innovate?". A
data mine supporting modelling helps decide this. Alerting when the routine is upset keeps focus on the here
and now problems in an information overload environment. A Workflow approach
is adopted.

Controlling Waste, Error and Corruption

Definition

Manifestations

Value for money

Keynesian policies but performance can improve. Pathology of the Law,
Health, tax collection, government contracts

Alerting

The red line graph shows 120 days of sales activity. 10
days in a transient increase is noted. The five day moving average
notices a slight bump (black line). Alert to level 1. Level 1 has five
days to fix but doesn't need it- this is only a one day transient. No
alert to level 2 is sent

30 days in a downward step change is noted due perhaps to something
like adverse publicity. After 5 days and no change (despite the best
efforts of level 1) level 2 is alerted however after a further 30 days
a little repositioning in the market produces an increase in sales.
After 5 days Level 2 is alerted and we see a new higher level of
demand.Level 1 stays alerted until this time. Alerting rules are agreed
and set for each employee task.

The spike transient might be due to a higher than normal level of sales activity. Examination of calls made suggests an innovation by a new employee and adoption of the innovation
led to the increase in demand. Subsequent analysis of customer account
demographics shows a change in market segment.

A time scale of days is chosen for illustrative
purposes. The management relaxation time of a given level and a given
task can be anything from seconds to months. The moving average
suppresses transient changes and alerting is done when a performance
parameter deviates from capability by say 10 or 15%. The existing local
variance of performance determines this initial alerting "algedonic"
threshold. There is an option to submit a given time series to a short
term forecasting algorithm to estimate the probability that a current
level of performance (actuality) will go out from capability
sufficiently far to require an alert. (Box-Jenkins
methods,
Harrison and Stevens, Kalman
filtering and recently Jones'
Gamma test have all been applied to this problem.) To improve on
monitoring by quarterly report relaxation times of less than six weeks
are indicated. Auditing, here, is seen as reporting on the analysis and
authentication of raw transaction data.

Beer's Management Cybernetics

The Viable System Model (VSM)

Beer called alerts "algedonic signals" from the Greek
αλγος, pain and
ηδος, pleasure. An alert can be sent for good or bad
performance.

Pask- an appendix on Identity and the implications for authorization

Pask's work in Management Cybernetics is less well known. In the later
years of his life he worked with several large and small enterprises
including Norsk Hyrdo (Norway's largest company) on a theme of "Organisations
as Living Organisms and Ecologically Sustainable Innovation".

In his last seminar on Interactions of Actors and Conversation Theory he
reflected on the Actors that produce products. Actors support production in
their conversations and have the following properties:

Context

Perspective

Similarity

Difference

Respectability

Responsibility

Amity

Faith

Agreement

Agreement to disagree

Purpose

Unity- not uniformity

Eternal support

Beginnings and ends

Adaptation

Generation

Evolution

Kinetic support

Kinematic description

Imperative acts

Permissive acts

Informational Openness

Organisational closure

Void and not void

These properties are axiomatic in status. Faith, for example, is the time
taken for a process to produce a product. Amity is the availability for
interaction. The comparison of similarities produces differences which may be
agreements or dependencies. Respectable means can be seen or observed and
responsible means a stimulus is needed before visibility is apparent or
respectability can be confirmed. Recent work by Uribe suggests a paradox
maybe respectable but requires stimulation to be resolved: the hidden
concepts must be unfolded for resolution.

Coherence and decoherence produces Differentiation and presumably the
above axioms (proof under way, perhaps) and oh yes distinctions must exert a
repulsive force. A distinction is a description. A concept is a procedure for
producing a relation not a set of things!

Consideration of these properties enable a full formal specification of
the identity of a process and its product. Hence we establish a development
route for enhanced authentication and thence authorisation.

A note on the resolution of disputes

In dispute resolution a breach of some implied or explicit contract or
agreement is noted. In general an innovation or change to the procedures
supporting the agreement is required to resolve the dispute. Applying the
cybernetics involved implies Viability can only persist when a Just balance
or equilibrium is maintained in the Actor environment.

This is coherent with the implicit VSM management heuristic: if it's
broken, fix it from the developing repertoire of solutions in System Four.
Beer saw System one-two-three as the autonomic nervous system with System
Four as the seat of conscious thought and conversational interaction. System
Five selects the solution from Four to apply to System one-two-three by
considering the evolving identity of the viable entity.